Question

The following transactions were incurred by Whooley Fabricators during January, the first month of its fiscal year.
Requirements
1. Record the proper journal entry for each transaction.
a. $205,000 of materials were purchased on account.
b. $174,000 of materials were used in production; of this amount, $146,000 was used on specific jobs.
c. Manufacturing labour and salaries for the month totalled $210,000. $200,000 of the total manufacturing labour and salaries was traced to specific jobs, while the remainder was indirect labour used in the factory.
d. The company recorded $16,000 of depreciation on the plant and plant equipment. The company also received a plant utility bill for $14,000.
e. $56,000 of manufacturing overhead was allocated to specific jobs.
2. By the end of January, was manufacturing overhead overallocated or underallocated? By how much?